Government warns 2030 decarbonisation target would place too many restrictions on business at a time of economic difficulty.
The government has seen off a rebellion by Lib Dem and Conservative MPs over calls for a carbon emissions target for the energy industry.
Senior Tory backbencher Tim Yeo sought to amend the coalition’s Energy Bill to set a “decarbonisation” target for the power sector by 2030.
But MPs rejected the move by 290 votes to 267 after a Commons debate.
Ministers say the target would place too many restrictions on business at a time of economic difficulty.
The issue has divided the coalition partners, with environmental campaigners arguing it shows David Cameron’s pledge to lead “the greenest government ever” has not been fulfilled.
Mr Yeo’s amendment, calling for a decarbonisation “target range” to be set by April 2014, attracted support from a handful of Lib Dem and Conservative MPs as the government’s majority was cut to 23.
Mr Yeo told the Commons that delaying a decision on targets would create a “needless but harmful element of doubt about the government’s true intentions”.
He insisted a target would not add a “single penny” to energy bills for the next seven years.
And Green Party MP Caroline Lucas argued that a target was crucial if the UK was “serious about securing a global deal on climate change”.
But Energy Minister Michael Fallon urged MPs not to rely on “blind faith” and vote for “decarbonisation by dogma or default”.
If it had been passed, the amendment would have ensured that almost all electricity was generated from carbon-free sources like wind and nuclear by 2030.